Unused Wi-Fi costs Minneapolis millions

Kyndell Harkness, Star TribuneDuane Haponuk, a traffic control agent supervisor for the city of Minneapolis, watched different intersections for traffic issues from his vehicle on Wednesday . For years, police vehicles have been unable to utilize the city’s Wi-Fi to monitor mobile cameras because there were too many dead zones.

Some high-tech predictions hovered around Minneapolis' decision in 2006 to spend more than $1 million each year to become the largest customer of a new, private citywide wireless Internet service.

Supporters said Wi-Fi would allow the city to remotely monitor water meters, send live video of crime scenes to police en route and provide firefighters with floor plans of burning buildings. A city report at the time said "laptops and handheld devices could be used in any room or area of City Hall without the need for tethered connections."

Six years later, most of City Hall remains a Wi-Fi dead zone, wireless water meters are a distant dream, police officers are just now receiving technology to view crime scenes and firefighters access floor plans without Wi-Fi.

The city nonetheless pays $1.25 million a year to USI Wireless, largely for bandwidth it does not use. Although city tech officials have made recent strides to boost future usage, Minneapolis used only 11 percent of the bandwidth it paid for in 2011 -- about $139,000 worth. That's up from 6 percent in 2010.

The Wi-Fi network has a benefit beyond City Hall. In addition to a host of city services that are improved by Wi-Fi, about 21,000 residents are taking advantage of the cheap Internet that is available because their government is the "anchor tenant." The city also has an array of free hot spots, an amenity for visitors.

The city accumulates credit for any unused bandwidth -- now estimated to be $4.7 million -- but under the agreement that credit goes away once payments end in 2018, 10 years after the system was completed. And city officials are coming to grips with the likelihood they will never use 100 percent of what they pay for each year.

"I think it's going to be really difficult to get all the way up there," said Otto Doll, the city's chief information officer, who was surprised to see the city's usage when he took the job a year ago. "Can I use the majority of it? You bet."

His department hopes to surpass 23 percent usage by the end of this year and 40 percent through 2013, partly by equipping hundreds of police cars with Wi-Fi and installing an array of new Wi-Fi cameras.

While many cities have ventured into Wi-Fi, Minneapolis' problem is unique. California-based broadband consultant Craig Settles said many cities own the Wi-Fi network they use for city services. He knew of no others that made a long-term commitment of recurring payments to a private company.

"You now have the risk of spending money that exceeds your needs because you've guesstimated so high," Settles said. Minneapolis' strategy of becoming "anchor tenant" was advocated at the time, however, since Wi-Fi providers were buckling under financial pressures of providing a low-cost service, he said.

'Definitely too small'

Several factors have contributed to the city's low usage of Wi-Fi. Technology took longer to advance than expected, departments lack cash to pay for upgrades, and they simply bought too much bandwidth. The tech officials who negotiated the contract have since left the city.

"Certain assumptions when we signed the contract were just impossible to meet," said City Council Member Gary Schiff, who voted for the plan and believes the usage is "definitely too small."

"For example, we thought we could transfer cellphones over to wireless technology. That technology does not exist."

Doll said some of the projections appear to have been "real loose."

During budget negotiations last year, the City Council pushed departments to explain how they would boost Wi-Fi usage. They now have a serious incentive: In 2011 the city began charging each department for its portion of the Wi-Fi contract.

The Public Works Department, for example, is using Wi-Fi on 13 snowplows partly to ensure in real time that they don't oversaturate streets with salt and chemicals -- which can harm plants and pollute rivers. They also use Wi-Fi to track about 50 garbage trucks.

The City Council passed on the opportunity this year to greatly expand Wi-Fi availability in City Hall and other city buildings, however. A pot of money set aside in the mayor's budget became a grab bag to alleviate other cuts, such as funding for the Minneapolis Television Network.

New uses

Moving more city services onto Wi-Fi is a daily exercise for David Roth, public safety manager for the city's Business Information Services.

For years, police vehicles have been unable to utilize the city Wi-Fi to monitor mobile cameras because there were too many dead zones. After extensive research, the city developed a solution to provide seamless Internet by using ultra-fast cellular cards as an instantaneous backup.

Roth installed that setup last week in Deputy Police Chief Rob Allen's Chevy Tahoe. Another 200 police cars are expected to receive it this year along with more than 80 regulatory vehicles. Traffic Services is already using it to monitor intersections during downtown events.

Not only will it allow police to monitor remote cameras throughout the city, but Allen said the department eventually plans to allow private businesses to route their own feeds during emergencies.

So if there is a bank holdup, Allen said, "a police officer pulling up to the bank has a picture of what's going on inside the bank."

'Four-year subsidy'

USI Wireless CEO Joe Caldwell said the program would not have been possible without the city's pledge. His Minnetonka-based company had about 100 employees when it was selected.

"We weren't big enough to go out and get a huge bank loan without them as an anchor tenant," Caldwell said. He believes the city's excess bandwidth won't be wasted, since USI might agree to continue carrying it forward when the contract is renegotiated in 2018.

Becca Vargo Daggett, one of the chief critics of the plan in 2006, said the contract has so far amounted to a "four-year subsidy" -- something it wasn't supposed to be at the time.

"An anchor tenancy, you get something ... for your money," said Daggett, whose group, the Institute for Local Self-Reliance, advocated public ownership of the network. "A subsidy is just a subsidy. It's just a payment."